Source: David Jackson / USA Today
President Obama nominated North Carolina congressman Mel Watt to head the government agency that oversees the government-backed mortgage giants Fannie Mae and Freddie Mac, prompting criticism from Republicans over proposals to allow some principal reductions for struggling homeowners.
“Mel understands as well as anybody what caused the housing crisis,” Obama said in nominating Watt to be head of the Federal Housing Finance Agency. “He knows what it’s going to take to help responsible homeowners fully recover.”
If confirmed by the Senate, Watt would replace acting FHFA director Edward DeMarco, a George W. Bush appointee Edward DeMarco who has been criticized by Democratic lawmakers and housing advocates for opposing plans for partial forgiveness of mortgage debt.
Republicans have signaled opposition to Watt’s nomination, saying proposals to reduce principals are likely to lead to more mortgage defaults and cost taxpayers money.
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